Britain: HSBC files show Tories raised over £5m from HSBC Swiss account holders. Labour too has received cash and loans from bank’s clients, while leaked documents also reveal many donors with HSBC accounts had non-dom tax status: here.
LABOUR PARTY leader Miliband clashed with Prime Minister Cameron over political donors who held Swiss bank accounts with HSBC, during questions in the House of Commons yesterday: here.
DAVID CAMERON’s longstanding vow to make “damn sure” that tax dodgers pay up was left a laughing stock yesterday after Tory treasurer Lord Fink admitted avoiding tax while claiming that “everyone does it”: here.
‘We are all tax avoiders’ says Tory Lord Fink: here.
By Thabo Seseane Jr. in South Africa:
Africa subject to billions in illicit capital flight
11 February 2015
A report adopted by the African Union on February 1 indicates that African governments are losing some US$5 billion a year in unpaid taxes, royalties and other charges as companies, criminals and wealthy individuals illegally siphon money from the continent.
The report ranks South Africa third, behind Nigeria and Egypt, in terms of cumulative losses between 1970 and 2008, which it says amounted to US$81.8 billion or 11.4 percent of Africa’s total illicit capital outflows. It was authored by a panel established in 2012 by the United Nations Economic Commission for Africa and headed by former South African president Thabo Mbeki.
Speaking at the report’s launch, Mbeki contrasted the estimated US$50 billion annual outflow to the total inflow of US$25 billion of aid and foreign direct investment. However, thanks to its opacity, the unlawful expatriation of capital from Africa is hard to quantify.
A 2008 study covering the years 2002 to 2006 found that the continent lost US$859 billion in cumulative capital flight. This compares to a 2010 study of the period 1970 to 2008, which arrived at a figure of between US$854 billion and US$1.8 trillion in illegally lost capital.
Whatever the actual figures, they represent a huge loss of revenue for African states, with mining and fossil fuel companies accused of being the worst culprits for the continent’s capital loss and resulting underdevelopment. A report by Sarah Bracking and Khadija Sharife on the South African diamond mining sector put the 2011 value of all uncut production at US$1.73 billion. The authors found that the biggest companies, De Beers and Petra Diamonds, accounting for 95 percent of all production, paid just US$11 million in royalties for 2010 to 2011.
Other studies expressed illegal capital flight as a ratio of gross domestic product (GDP). According to research cited by Jeff Rudin, associate researcher at the Alternative Information and Development Centre (AIDC) in Cape Town, illicit capital flight increased from 9.2 percent of GDP in 1994 to 23 percent in 2007. “This means,” Rudin observes, “that, at the same time the government was implementing Thatcherite neoliberal policies to bring foreign investment to South Africa, a vastly greater volume of capital was leaving our country.” …
Some of the architects of South Africa’s capital flight gathered under the aegis of the F. W. De Klerk Foundation in early February. The dignitaries celebrated 25 years since De Klerk, the last apartheid-era president, made the speech announcing the unbanning of liberation movements such as the ANC, and the release of political prisoners including Nelson Mandela who succeeded De Klerk and, jointly with him, was awarded the Nobel Peace Prize for laying the foundations for a democratic South Africa.
Businessman Johann Rupert, patriarch of the richest South African family with some US$7 billion in assets, said at the event that demands for higher wages were not sustainable. In terms of spreading opportunities more evenly, he explained, “My family has always held that one must repatriate wealth to South Africa.”
His words were at odds with remarks attributed to Johann Van Loggerenberg, the South African Revenue Service (SARS) executive in charge of enforcement and investigations who abruptly resigned on February 4. Van Loggerenberg was suspended last year amid allegations of running a “rogue” unit, which among other accusations is said to have run a brothel and spied on President Jacob Zuma. When suspended, he was overseeing an investigation into an apparent tax avoidance scheme of British American Tobacco, a multinational controlled by Rupert and which Van Loggerenberg said was illegally withholding about R1 billion (US$89 million) due to SARS.